"While it's very enticing to
hear you might be able to recover money lost from a previous investment or investment
scam, some investors end up losing even more money to unregistered con artists
who run so-called ‘recovery scams,'" said Gerri Walsh, FINRA's Senior Vice
President of Investor Education. "Fraudsters can paint a very credible
story to persuade you to send money in advance to get back at least some of
what you originally lost. But the sad fact is that the money you send may
itself be lost for good."

While recovery scams
have been around for a long time, their advance into investment recoveries is
indicative of a sophisticated criminal evolution and the potential for larger
losses.

Generally, recovery scams
use a variety of lies to add credibility to their pitch. For example, some
claim to represent companies or government agencies; some say they're holding the
money for you; and others offer to file “necessary” paperwork on your behalf or
get your name at the top of a list for victim reimbursement. FINRA noted that recent scams involving
investment recoveries often included similar tactics, such as:

Urgent correspondence and high-pressure
calls are received from official-sounding organizations that claim to work
closely with the U.S. government.

Callers may impersonate registered
securities professionals and brokerage firms. In some instances, these con
artists state that they are registered with FINRA and can be verified using
FINRA BrokerCheck, a service that allows investors to check registration and
other information about securities firms and investment professionals. Beware.
These individuals may go so far as to falsely use the name of a real person or
firm that is registered with FINRA.

Once contact is made with the investor
and the investor expresses interest, a series of official-looking documents are
sent to assure the investor that money is waiting in an account and can be
recovered for a fee.

Notably, FINRA and the
FTC both warn that lists of previous victims are often kept, sold or
recirculated amongst criminals, so it is common for scammers to "go back
to the well" to try to take more money from a previous victim.

Read FINRA’s official Alert
for more information on how to spot and avoid fraudulent "recovery"
scams.

If you have questions or need assistance with your legal matter in
California or nationwide, our experienced FINRA attorney in San Diego can
assist you. Please contact us, or set up an appointment at our San Diego offices.